As the equine industry continues to thrive through increased horse ownership and an expanding equestrian sports market, agents can offer the benefit of their knowledge of equine-related risks.

As in many industries, there are numerous challenges that participants in the equine industry must face. Independent agents seeking to target this niche can do so by helping their clients overcome the following challenges:

1) High veterinary costs. Just like athletes, horses are prone to a variety of health issues, including physical injuries that can take them out of action for many months. Managing a horse's ailments is essential but can also be expensive.

“The rising cost and availability of new medical procedures from veterinarians is certainly a challenge in the industry," says Jade Stanbrook, equine insurance broker, equine division, Foy Insurance. “Not only is it making it harder for the insurance companies to remain profitable, but it is also making it harder as a horse owner to know what coverage they will need if their horse is injured or becomes sick." 

2) Tailored coverage. One of the most prominent trends in the equine insurance market is the demand for tailored insurance coverage. Carriers are responding with policies that allow customers to choose which coverage options they would like. The challenge for both agents and their clients, particularly those who are new to the equine industry, is identifying the coverage that aligns with their needs.

“Horse owners are relying on [tailored coverage] as a necessity versus an optional luxury like they would have done in the past," says Lindsey Kerr, commercial lines senior market underwriter, agribusiness, Westfield. “There's a lot of awareness out there now about how important it is for their financial safety."

Additionally, many states have passed equine liability laws that protect against the inherent risks of equine activities. As regulations differ from state to state, agents should understand and relay the applicable regulations to their clients. 

3) Education. “I think that the biggest thing for agents right now is awareness and education," Kerr says. “Commercial equine liability coverage is imperative if you're performing a commercial exposure, like boarding, instruction, training and breeding to ensure that you have coverage for any scenario where you are exposed to being sued by a third party over bodily injury or property damage. And then care, custody and control coverage which is negligence coverage, is also important."

For non-commercial horse owners, the “challenge is educating clients so that they understand their responsibilities if they have their vet out for something that is not routine," Stanbrook says. “There is a constant struggle to disassociate the norms of regular insurance—home and auto—with equine insurance. 

Agents should warn customers that “it is imperative to speak with your agent—and in most cases, start a claim—when you are having your vet out for an accident, injury or illness, even if it is small," Stanbrook explains.

4) Cyber. Today, the equine industry is taking advantage of technological advancements, such as health monitors for horses. Additionally, advances in breeding technology have improved breeding efficiency, increasing the breeding capacities of stallions and enhancing the breeding success of both stallions and mares with impaired fertility, according to Equus magazine.

The problem for clients arises when they “take their credit card info and then send it worldwide to whoever wants to breed with their stallion." Kerr says. “I think that those [cyber] breaches right now are huge."

5) Coverage gaps. As the equine industry continues to expand in different directions, insurance carriers are responding to requests for customized policies. In addition, the hard market has impacted the market.

“Instead of seeing big increases in premium costs, the insurance companies are just broadening exclusion wording, non-renewing policies and decreasing the availability of insurance to some breeds and usages," Stanbrook says. “As exclusion wording becomes broader and as insurance companies add to the policy limitations, it is imperative to identify these limitations and discuss the ramifications they may have on a claim in the future." 

For example, “many companies are starting to limit claim payouts for ulcers, which are costly and common," Stanbrook explains. “Avoiding these potential gaps in coverage is challenging and relies on agents to be transparent about them." 

Olivia Overman is IA content editor.